Let’s face it. We are all biased. Bias stems from our past and our current environment. It influences our future. Bias shapes the way we feel, the way we think, and our behavior. It drives our decision-making process more than we care to admit.
If you search the internet, you can find many articles and studies on the various types and flavors of bias, from general behavioral sciences to specific impacts on market sectors, politics and cultures.
Confirmation bias is important because it’s the tendency to search for or interpret information that supports one’s preexisting belief or expectation. I want to focus on one type of confirmation bias that impacts the planning phase of construction and engineering projects: optimism bias. Optimism bias tends to influence stakeholders into making decisions by looking through rose-colored glasses.
We talk ourselves into believing that our decision will result in success, so we believe it to be true. We want it to happen. Maybe it’s a pet project. Perhaps it’s a project that will keep your team gainfully employed or a project that meets the targets set by executives. We can convince ourselves there’s always a good reason to believe what we believe.
Diving a little deeper into optimism bias, we develop an anchor that reinforces our optimism and prevents us from adjusting our perspective. We convince ourselves that if we can grab hold of the anchor and not let go, everything will turn out well. We’re often unaware of this anchor and our subconscious is pulling the levers.
So when someone asks you for a budget number and they are seeking that anchor, the first number you give them will be the one they lock onto. Even if they say “…and I won’t hold you to it,” they will. Not because they are bad people, but because it supports their optimism bias. You gave them the anchor they needed and they’re not going to let go.
So make sure you give them the best budget number you can. Easier said than done, right? They don’t give you much information and certainly not enough time, so you need something better than pulling a number from your memory. Or worse.
A trusted project history database can serve as a great source for developing an initial budget number from similar (analogous) projects. It can also serve as the source for comparison data for benchmarking purposes. With it, you can provide objective, fact-based guidance on project performance and feasibility.
While we shouldn’t expect to change the confirmation–optimism bias of a project stakeholder, we can provide defensible responses backed by facts using historical data. And we can open their eyes by removing the rose-colored glasses in the process.